Sacramento International Airport

Monday, April 25, 2005
Airport pays millions to buy snake habitat
Feds levied penalty for filling wetlands
By Mark Larson
The Sacramento (CA) Business Journal

Federal regulators have put Sacramento International Airport in the reptile-housing business, and it’s costing millions. After years of improperly filling wetlands at the airport, county officials now are competing with commercial developers to acquire land as habitat for giant garter snakes. In the end, the snafu could wind up costing the airport system more than $11 million, with some of the cost passed along to the airlines that pay landing fees here.

Sacramento County Airport System assistant director Rob Leonard has been making deals over the past year for the airport to buy 300 undeveloped acres in northern Sacramento and southern Sutter counties, land that other eager buyers are trying to snap up to mitigate for construction elsewhere.

Federal wildlife officials ordered the buying binge as punishment for the airport’s years of plowing dirt, without authorization, over wetlands that had been home to the snakes. Giant garter snakes are listed as threatened and protected by the U.S. Endangered Species Act.

“It was illegal and they got caught,” said environmental attorney Jim Pachl, who three years ago was among a group who discovered the filled-in wetlands and notified regulators. “It was clearly wrong.”

Typically, three acres of mitigation land must be acquired and set aside for every acre developed. But because the airport didn’t get the needed permits to plow dirt into the wetland areas, Leonard said, the settlement with regulators forced the airport system to buy five acres of mitigation land for every one damaged — 300 acres, rather than 180.

The pace of housing development in the area, notably Natomas, has developers clamoring for mitigation land. The clamor has launched prices to about $25,000 an acre.

“Over the past two years, land prices in Natomas have gone up dramatically,” Leonard said. “There’s a fair amount of speculation and a lot of volatility. It’s been a challenge to find the land and then buy it.”

The airport has only 70 acres left to buy, with a deal expected to be inked in coming months. The 300 acres, much of it northeast of International’s east runway, also will help buffer the airport from encroaching development. Plans call for it to be leased as open space to the Natomas Basin Conservancy to fulfill the settlement terms with the U.S Department Fish and Wildlife Service and the U.S. Army Corps of Engineers.

Because the case is still open, Al Donner, spokesman for the federal Fish and Wildlife Service, declined to comment on it.

Revenue diversion

The airport will pay for the mitigation land, Leonard said, with revenue it generates at Sacramento International through parking, food and beverage sales, retail sales, leases and landing fees.

Landing fees and leases by airlines at the airport make up 31 percent of airport’s revenue pie. That means airlines serving International will end up having part of their fee money go for the settlement instead of the usual place: to help offset their expenses at the airport.

“It’s essentially a cost of doing business,” said Leonard, who said the added cost will not delay any projects planned by the airport. “It’s unfortunate. The airlines are not pleased about that.”

Terry Trippler, a Minneapolis-based airline industry analyst, said airports have been hit with a lot of new costs lately, such as added security, which eventually gets passed on via airport prices.

“That’s maybe why it costs $7.50 for a Coke at the airport,” he said.

The airport’s settlement means the Natomas Basin Conservancy stands to gain a big new chunk of real estate to add to its land bank dedicated to protecting natural habitat.

“The airport’s mitigation is a pretty big deal,” said John R. Roberts, the conservancy’s executive director. The biggest contribution so far was 575 acres from an Allegheny Properties joint venture, he said. In all the conservancy has 3,700 acres, not counting the expected airport land, with a long-term goal of 8,750 acres.

The airport’s price for buying the 300 acres is expected to come to $7.5 million, said Leonard. But in turning it over to the conservancy — it has to be via a lease because of rules regarding how airport revenue is spent — it will also have to pay a negotiated endowment to the conservancy to cover land restoration and administration costs. Leonard said he wants it to be a one-time fee.

That fee, however, can total about half the land’s value, which in this case would be roughly $3.7 million, bringing the airport’s total bill to $11.2 million.

Said Leonard, “it could be somewhere in that ballpark.”

Watch the birdie

Leonard said the airport wetlands were illegally filled with dirt on the orders of former managers who have since retired. Two areas were cited by federal investigators — Prichard Lake and Jacob’s Slough, on land north of the airport terminals.

The fill-in activity took place from the “late ’80s to 2000,” said Leonard. He declined to state the reason for the work, but added, “There’s always concerns about water collecting, because of birds, or draining.”

Birds in flight are a hazard to jets approaching or taking off, because of the potential for collision or possibility they could be sucked into an engine. The airport has historically taken measures to keep them away from runways and approaches, using techniques such as noise-making cannons and reflective Mylar ribbons near spots where water collects.

Attorney Pachl said efforts are under way to restore Prichard Lake. Jacob’s Slough, a much larger area, he said, is not being restored because of concern about attracting waterfowl.

The land bought for mitigation as part of the settlement, Pachl noted, works in the airport’s favor as a buffer to encroaching development.

Much of northern Sacramento County and southern Sutter County is primed for development, he added, and buffer land is critical to keeping that buildout from interfering with airport operations.

International is expected to double its passenger totals over the next 10 years and possibly evolve as a hub. Pachl figures that’s bound to happen because Bay Area airports are already overcrowded.

For 2004, the airport had 9.5 million passengers pass through its gates, up 9.1 percent from the previous year. It has long-term plans to add another terminal and runway capacity.

But now International finds itself in the middle of a rapidly developing area.

“That,” Pachl said, “is a major conflict.”